saw. but today they're not doing a whole lot. >> nice to nice to have you back by the way. >> good to be here. tomorrow i will be here chatting with the people at home and we hope they will be here too. see you then. bye, guys. jenna: we start with this fox news alert. opening statements underway right now in the trial of the accused underwear bomber. we're so glad you're with us, everybody. i'm jenna lee. >> i'm gregg jarrett in for jon scott 6 "happening now", his name is umar farouk abdulmutallab. the nigerian native representing himself in court assisted by a court-appointed attorney who will apparently deliver the opening statement. jenna? jenna: we'll talk a lot more about that later on in a legal statement we have

today. the evidence is stacked high against this 24-year-old who was badly burned in a plane full of witnesses and prosecutors say he told the fbi he was working for al qaeda at the time of the attack that is the situation right now. let's get to mike tobin live outside the courthouse in detroit with the latest. we have a little bit of an idea what the prosecution has to say, mike but what about the defense? >> well, so far the defense hasn't had a very successful day. they have put in two motions trying to block some of this very compelling evidence from getting into court and both of those motions were denied. we do have an idea as far as what the prosecution is going to do as prosecutor jonathan tuckel is making opening statements right now. he said that the defendant, umar farouk abdulmutallab, never intended to arrive in detroit. he intended to arrive in heaven at the end of that flight. he said he didn't eat on board the flight. he left his seat a number about of times to go to the bathroom. he was going through

rituals. he was prepared to died. he decribed a loud pop heard own board the aircraft. the defendant was engulfed in flames. there was a lot of smoke and to quote the prosecutor, all hell broke loose. we're getting an idea for the strategy, at least the attack that the prosecution is going to take in this case. the defense so far not successful today, jenna. jenna: we can see a little bit, we'll put you back on screen, mike. we see a little bit over your shoulder and see the courthouse behind you. talk to us a little bit about security there. what is that like? >> reporter: we've seen a larged motorcade armed he is court to get abdulmutallab here and they took him through the sally port and he was escorted up to the courtroom. we've seen bomb-sniffing dogs. beyond that what we can see in and around the courthouse there is not a dramatic increase in the security presence beyond what you already have, what has been enhanced at every federal building, jenna. jenna: mike tobin the latest out the trial of the underwear bomber. more on the story throughout

the day. mike, thank you very much. gregg: they have a couple terrific lawyers. in the meantime, we're turning to politics now. the race for the white house, one candidate becoming the favorite punching bag if you will among republican contenders lately and no, not the president. frontrunner mitt romney is getting slammed from all sides it seems. rick perry releasing a big ad, likening romney to the president. michele bachmann saying quote it is not good enough to settle for anyone but barack obama. jon huntsman, blasting romney on foreign policy. chris stirewalt joins us, the fox news digital politics editor. host of power play on foxnews.com live. chris, good to see you. these republicans forgotten the 11th commandment of ronald reagan, thou shall not speak ill of any republican. are the competitors of romney sharpening their long knives for tonight? >> this debate is so crucial for romney, simply because

as the front runner in a state he must win and laid the heaviest marker on, new hampshire, governor romney has to show that he can handle these sort of withering attacks that he is receiving. it was a lot easier for him when rick perry was out in the lead because romney could throw jabs and lay back and let them pull him down. now he is the lead dog and everybody else is trying to undermine him. gregg: rick perry and michele bachmann are really cratering as you know in the polls. they have put their criticism into overdrive but perry in particular. he came out with what some are describing as really devastating ad which, democrats may want to borrow for the general electric. -- election. it portrays romney as a slick and synthetic politician. boy i've been looking at polls here. these criticisms don't really seem to be working. what do you think? >> certainly there is caution for governor perry what happened to you can michele bachmann. when she was a consistent attack dog during her time in the top tier it hurt her. governor perry hasn't fallen

the way that michele bachmann has fallen. he dropped to half of the support he had after his august and early september surge and stays down there in third place behind herman cain and mitt romney. but bachmann is a cautionary tale for perry. if perry is too aggressive attacking romney, now he must attack so he stays relevant to some degree, if he is too aggressive republicans will come to resent him for doing that even if he pointing out underlying concern about the more moderate romney who positions evolved over time. gregg: nationwide gallop poll in it, and essentially has herman cain and mitt romney in statistical tie. cain at 18% and romney at 20%. that may have prompted romney's comment yesterday wherein he suggested herman cain may not be ready for the oval office. you think cain is getting to mitt romney? >> to the larger part of everything, herman cain has been a real positive for romney. he really helped romney

because he has helped absorb the support for rick perry that has gone away, moved away from perry can't go to romney. these are conservative voters who are part of the hard republican base. they're not going to romney. so from romney's perspective as long as it is not rick perry it is okay if the votes are going someplace else. now that cain is starting to consistently poll at these numbers romney will have to take another look whether this is all together a good thing. gregg: i suspect the dynamic may change tonight because cain and romney will be front and center next to each other. perry will be off to the side with the others. we'll wait and see. chris stirewalt, thanks very much. you can catch more of chris at the bottom of the hour. he has daily dose of politics. he is hosting. "power prey". go to foxnews.com and click on the link. jenna: the president's plan is expected to get a crucial test in the senate today. it is $440 billion measure

including a payroll tags cut and includes a tax surcharge on the wealthy to pay for it. chief congressional correspondent mike emanuel is live on capitol hill with the latest from there. good morning, mike. >> reporter: good morning, jenna. of a the president saying pass my jobs plan now and the site will finally come up later tonight. it is not expected to pass. for one, senator joe lieberman doesn't like the price tag. >> to me the number one thing we should do to get our economy going again is deal with the debt and the president's jobs bill costs almost half a trillion dollars. so we've got to, that is money we don't have. >> reporter: now democratic leaders are trying to show republicans obstructing as democrats are presenting their ideas to move the economy forward. to be truthful there are democrats who don't like this plan either. some are from conservative states. others have tough re-election bids. you can already hear political ads playing after the vote fails for those who

voted for it and republicans say they are too close to president obama. meanwhile white house senior advisor david plouffe is predicting this about tonight's vote. >> we're going to get the vast, vast majority of democratic senators tonight. we hope we get some republican senator as because the economy is far too weak. question are we going to do something about it or are we going to sit back? >> reporter: so we'll have drama about this vote. it is expected to fail. we expect democratic leaders to break up pieces of this bill to bring them up for a vote. you can expect the more popular aspects to ultimately pass. first things first. they will vote on the plan itself in its entirety. jenna. jenna: we'll ask one of the president's key advisors about that coming up in about 20 minutes. if the president is all right with the piecemeal approach. we'll see. mike emanuel. thanks so much. >> reporter: thank you, jenna, police are back in the missouri home of lisa irwin, the 10-month-old toddler to disappeared in the middle of the night one week ago.

rick folbaum has more on what investigators are doing. >> conflicting reports on a possible arrest in the disappearance of lisa irwin in kansas city. police have been conducting interviews with the girl's parents and even doing reenactments at the family home. police say they are not close to making arrest the young girl's aunt, telling "good morning america", the lisa's mother, deborah bradley expects to be arrested soon. >> do you think deborah will face an arrest soon? >> honestly. yes that's is what the police do. they don't have any lead to they have to pin it on somebody. >> do you think it is nefltable? >> kind of. >> police are denying that. they are turn returning to the home. they claim the front window was tampered with the night the girl was missing. police are trying to duplicate a break in through that window.

local tv stations that conducted interviews with deborah bradley and her h. neighbors are being questioned about reports of a homeless plan spotted in the neighborhood about two weeks ago. this is very strange case. lisa irwin, about 30 inches tall with blue eyes and blond hair. she has two front teeth. if you have any information on her whereabouts cac your local law enforcement office immediately or call the police in kansas city. the number on the screen is 816-474-tips. if we get more information, gregg. we'll pass it alongers we'll have more coming up on "happening now." rick, thanks very much. jenna. jenna: a 12-year-old went into cardiac arrest on her way to class a few weeks ago. we caught this all on camera. how quick-thinking teachers saved her life and why her parents want you to know about this amazing story. we're live at the school coming up. gregg: the occupy wall street protesters heading uptown here in new

york city, taking their message to the front doors literally of some of the city's most powerful people. jenna: if the powerful people are actually there. you never know. gregg: i'm thinking not. jenna: the question of the day, should congress do something about the jobs crisis in this country. choose from two answers. yes anything legislative or no, let capitalism work. you can see how others are voting. you can leave a comment. during the break go to foxnews.com/happeningnow. we'll see you in three minutes. looking good! you lost some weight. you noticed! these clothes are too big, so i'm donating them. how'd you do it? eating right, whole grain. [ female announcer ] people who choose more whole grain tend to weigh less than those who don't. multigrain cheerios... five whole grains, 110 calories.

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jenna: this morning some new fears about the fate of the u.s. economy. a brand new report out tomorrow that we're getting a first look at today, says this. quote, unless we take dramatic steps it will be japan all over again. let's go ahead take that down. that is little confusing to see on the screen. this is professor sachs let me read the quote if i can again, professor. unless we take dramatic steps it will be japan all

over again. continuous deflation, weak economic growth and in and out of recessions and hue unemployment that is part of a new report, the way forward. jeffrey sachs you saw him early. that is okay. internationally renowned economist and author of a new book, the prize of civilization. one of the authors of this report says this is like having a low-grade fever all the time. do you agree with that diagnosis that is what is ahead for us in this economy? >> that report is agreeing what i have written in the price of civilization. the idea that i think is correct that the u.s. faces a structural challenge. how do we compete in the world economy? it is not something that can be solved by short-term stimulus, a short-term boost. we need a long-term strategy and that's what that report's saying and that's what my book describes in considerable detail. jenna: let's talk a little bit how we do that. one of the things we're seeing today is a jobs bill that will be on the senate floor. procedural vote to maybe

move it forward is not expected to work. looking at something like a half billion dollar jobs bill. how effective would that be in today's economy? >> i'm not impressed with these measures. this is basically a one-year bill and what we need is a 10-year strategy. to be able to compete internationally. we neat higher skills in our economy. we need more of our kids finishing college. basically 60% of our kids don't make it through college. other countries runway ahead of us in that kind of high-level training. we need more modern infrastructure. i've been on highways completely backed up in this country. dilapidated, shocking how we let things slide. we need science and technology. all of that requires both the role of government and of course a major role of the private sector. they have to run in a complimentary fashion. and what is on in washington right now is short-term gimmicks unfortunately, not long-term solutions. that is what the book is

really about. jenna: how do you balance that? you mention there is a role that the government can play but you also mention the private sector as well and there is lot of debate obviously how big or how small the government should be right now. so what's the balance? how do you find the key balance for economic success but also keeping both sides in check, if you will? >> i was in silicon valley yesterday and what silicon valley executives say they need more skilled workers, not just foreign workers coming in to fill positions that americans should be filling. so the ideas that silicon valley would employ the people but america has to produce the talent, not just import it from abroad. this is where government plays a major role. all of these successful countries that are developing very high-technology, high-skilled labor forces have a major role of government at all stages of the education process. we need the same thing. then of course industry is the one that will be employing those people. right now they're employing them coming from abroad, rather than from america. jenna: one of the things

you've talked about is higher taxes as part of this broader plan. a more holistic approach to fixing the economy. why you had is the american people trust the government with our money at this point seeing the amount of debt that we have just on the books? >> well, of course government has to be competent. without competence, people won't want to pay taxes. so you have to have a good strategy. then at the same time we have to understand how much of our income now is being hidden in tax havens abroad. we have massive tax evasion, massive tax avoidance, massive transfer pricing, that is putting corporate profits into the cayman islands. we're at the lowest corporate tax collections, not what is on the books but tax collections in modern american times. and this is an abuse of the system often with the connivance of the politician and the irs so i'm talking about enforcement of the rules. i'm talking about cracking down on these tax havens. i'm talking about making

sure that people who have phenomenal wealth pay what they ought to be paying so that our country works properly. this is really the essence. jenna: if i could, professor, sorry to interrupt you, just to be clear not about new taxes but just making people pay the taxes that are out there now? or are you talking about a completely new tax structure? or are you talking about republican plan to lower corporate taxes, get away from the loopholes if that is possible and keep the money here at home? >> well we need to get away from the loopholes, that mart is right. but we can't afford to cut the taxes and make it so-called revenue neutral because we have a budget that is bleeding right now. that's where i think it is a little bit, not right to tell the american people we don't have to collect more revenues. we do have to finance the science, the technology, the skill development, the modern infrastructure on which our businesses can be competitive. right now the businesses are losing to foreign competition.

our major companies are creating jobs abroad, not at home. they need a, a more skilled labor force and a more modern infrastructure in order to be able to do the job at home and for that we're going to need revenues and for that companies are going to have to pay rather than funneling their money to tax havens. we're going to have to get serious about both the level of revenues and the efficiency of the tax system. jenna: it seems like you're also saying be serious about the time horizon. it is not 2012 by the next election and that we're talking about a decade that is something more we would like to talk to you next time you're in new york. you're welcome anytime, today. thank you for your time. >> thank you, love to be with you. look forward when i'm back in new york with you. jenna: thank you, sir. gregg: we're getting our first look at new videotape. a deadly attack on a nato convoy. look at this. what police say may have inspired the latest violence. the president is hitting the road to push his jobs plan with the u.s. senate

set to take it up today. folks on main street are calling for action we'll take a look at the political wrangling that is going on behind the scenes. we'll be right back. >> we, out of five people, only two people are working. that is me and my mom. my brother is unemployed. my sister is unemployed. >> there are no jobs. they have taken away the jobs and people are losing their homes. we need jobs. banks are not working with the people, with the families.

gregg: this is truly amazing story. a heroic rescue in texas of a 12-year-old girl. she collapsed on her way to class and her heart stopped beating. the whole thing on videotape. fortunately two coaches were nearby. they used cpr and an automated external

defibrillator and they restarted her heart. today the school will celebrate kylee shea's recovery. we're at the fool with a full report including an interview with those hero coaches. jenna: as you mentioned we're awaiting a key senate vote to advance the president's $447 billion jobs bill but it is not expected to pass in its current form. in fact even senate democrats predict it will fail. they say they will break up the bill and try to pass it piecemeal. the president is on the road. he will meet with his jobs council in about 40 minutes from now. meantime, melody barns a key adviser to the president and traveling with him today and joining us now. melody, nice to have you on with us again. >> always a pleasure to be with you, jenna. jenna: melody, does the white house support breaking this bill up? >> well the first thing we're going to do is focus on the senate vote today. as you said in the lead-in the senate will take a

important vote on the president's jobs package a jobs package independent economic analysts said could bring 1.3 to 1.9 million jobs, jobs that are desperately needed the attention today is on that vote and getting that vote through the senate. jenna: the president expressed frustration working with congress and political realities as they are. what is the president's backup plan? >> right now we're focusing on the vote taking place in the senate. you know we've got the vast majority of democrats who are going to be with us. the question is whether or not there are republicans who will join with those democratic senators to do something that could bring as many as 1.9 million jobs to the american people. so our attention is on today and getting the job done. we'll focus on tomorrow when tomorrow gets here. jenna: how does the president feel about the senate democrats that have been outspoken against his plan? >> well the president enjoys engaging with senate democrats, republicans, independents. he wants to get the best ideas on the table.

that is why he put together a bill that has received bipartisan support for any number of the initiatives over the years. that's why he is so pleased that independent analysts have told us how many jobs that this could bring to people sitting on the ground. and that is why he is engaged with democrats and others on the best way to pay for this bill. so he considers that debate to be important but the bottom line is, we've got to pass this jobs bill if in fact we're going to put americans back to work. jenna: we mentioned the meeting with the jobs council today. should we expect another jobs plan coming from the president over the next several weeks or months? >> well the president put together this package based on the best ideas and bipartisan ideas so he could move it forward. what he asked his jobs council to do are and these are people from labor, from the private sector, some of the best mind in america, is to help him and give him additional ideas that we can continue to work with. this jobs plan is important and it is our focus number one for today but we've got to keep on getting the best

ideas from people around the country so that we can move forward and we can grow our economy and build the resilient and strong economy that will put people back to work, keep them at work and create economic security for people at home. jenna: that is an interesting group of people, the jobs council. maybe at some time we'll you. you're on the road a lot. >> please do. jenna: hang out with the jobs council. it will be a good time. we appreciate your time as always, melody. thanks for joining us. gregg: there is a fun group, the jobs council. jenna: they are powerful ceos. gregg: they like to yuk it up. jenna: wouldn't you want to talk to them? jobs is important. gregg: it is important and i'm joking around. jenna: rick has been talking to our viewers about jobs, right? our viewers would love to be a part of the jobs council. >> they would love to join you and hang out with the jobs council. we asked folks if they thought congress should do something about jobs. here is representative comment from the chat room. i want congress to do major deregulations.

then we'll see the job market aimprove dramatically. that is from mark. look at these numbers about. should congress do something? only 21% say yes. 79% say nope, let capitalism work its magic. congress has no business getting involved in at that type of thing the private sector can take care of it on their own. that's what we're seeing guys. jenna: we're seeing a crisis of confidence in all the leaders, regardless of parties. maybe that is being reflected in our own poll. rick will continue to monitor the web wall and meantime we have new video. gregg: this video just crowsed our international desk. this is deadly violence in pakistan. reports coming in that gunmen opened fire this convoy of nato fuel supply trucks triggering a massive fire and explosion. two of the drivers were killed. these attacks are on the rise since the killing of usama bin laden and other high-ranking al qaeda leaders. what happens if you accidentally take someone else's umbrella?

you could end up in jail. that is one example of what people are saying are too many laws coming out of washington. we're going to tell you about some crazy crimes in a live report. jennav accidentally. people take mine all the time. the terror trail of the so-called under wear bomber underway right now but did federal prosecutors make a mistake that could jeopardize a conviction?

>> welcome back to "happening now." we're in the acquisition rooms where the satellite feeds come into us from our remote cameras all over the world. let's look at rm 239. they're laughing and dancing ahead of the president's speech on jobs in pittsburgh. let's go over to the remote camera, where is it, 291. this is hurricane jova. it has been a category 3 hurricane. right now the outer bands hitting southwestern mexico. here's the good news. even though there could be heavy rain, mudslides, flash flooding in mexico, it will not hit the united states or at least it will not harm the united states. we'll continue to follow these stories. jenna? jenna: gregg, we'll turn to some international news now. a new u.n. report citing evidence of torture inside afghanistan's prisons. many alleged victims are suspected taliban fighters captured by coalition forces and then interrogated by

afghan intelligence services and police. all of which could complicate coalition efforts, some say, to turn over security responsibilities to the afghanis. molly henneberg is live in washington with the latest. molly, first of all why is this so important and how did the u.n. get this information to begin with? >> reporter: hi, jenna. over the past year united nations interviewers went to around 40 prisons around afghanistan. some run by afghan intelligence services. some are run by the national police and interviewed a few hundred detainees. as you are saying most of them held on suspicion helping taliban or terrorist groups plan attacks in afghanistan. most of them captured in the field by u.s. or nato forces and turned over to the afghans for prosecution. in some prisons detainees had no reports of torture. but in or thes according to the united nations torture appeared to be quote, practiced systematically according to a detainee. also in a number about of cases united nations interviewers observed

injuries, marks, scars that appeared to be consistent with torture or ill treatment or bandages or instruments of torture described by detainees such as rubber hoses. in most cases torture was used according to the report to obtain a confession or other information. jenna: molly, we mentioned this could complicate coalition efforts to turn over responsibility, security responsibility to the afghanis. why would that be? >> reporter: let's talk about what's going to happen as a result of this. for one thing, u.s. and nato military officials have stopped transferring fighters they capture on the battlefield to certain afghan intelligence and afghan prisons, to certain of them, quote, as a precautionary measure. the u.n. did not find any evidence that afghan president karz karz's government is directing or ordering torture of prisoners t seems to be found in certain prisons led by certain intelligence or police officials. the u.n. report calls for the afghan government to do

more to prosecute people, the bad apples, if you will, who are responsible for the mistreatment of detainees. jenna? jenna: molly henneberg live in d.c. molly, thank you. gregg: a fox news alert. opening statements now underway in detroit in the trial of accused underwear bomber, umar farouk abdulmutallab. the nigerian native pleading not guilty to charges of attempt to use a weapon of mass destruction on the failed attack on christmas 2009. what can we expect as the trial unfolds? let's get other legal panel in this on. joining' former pros court tore tom linet and. tom, start with you. remnants of explosions on his body and you have this video he left behind he talks about his suicide mission. as prosecutions go this is a pretty easy one but you think it shouldn't even be in federal court. why? >> absolutely, gregg.

first let me agree with you. it is a slam-dunk. prosecutors will convict this guy if he doesn't at last minute anticipate accept a plea like shoe-bomber richard reid did. the reason people like me criticize giving civilian trials to islamic terrorist who is have no nexus to the usa other than trying to murder our people, it gives individuals, a soapbox, a stage courtesy of american courtroom, american judicial, system, oh by the way on american taxpayer's dime, to expound, you know, these insane ramblings. you know, murderous views. gregg: right. >> you know, it is all again at our expense. whereas if you tried them by military commission like george washington used like abe lincoln used, like fdr used it would be much more limited proceeding. they still have their day in court. gregg: chad, what about that? it is clear he have wants to make a mockery of the u.s.

justice system because all indications demanded to represent himself. doesn't tom have a point? >> well, he has a limited point but this happened over american soil, number one. number two, you know, usually a man that represents himself has a fool for a client and a fool for a lawyer but this kid is not a fool. you're correct. he does want to make a mockery of the system. gregg: why let him do it? you don't have to. you could treat him as enemy combatant and try him in military tribunal? >> that is moot point now because they didn't do that. but what i do know for certain, now there's a trial. he has the right to a trial. and if, as a defense attorney, if obviously he is trying to do it on his own but if i had a chance to come forward there are things i could argue. this is a nigerian kid that fell under the spell of the holy jihad and this bomb that he had, let's face it, it wasn't even a bomb. it was a firecracker. it couldn't kill himself let

alone a plane. gregg: tom, that doesn't sound like winning argument. >> it goes back to factual versus legal responsibility. we all remember that from law school. what will be relevant here, this is individual that clearly had criminal intent. he will tell you that himself. he committed an owe vote act in furtherance of a conspiracy which was supposed to be a terroristic mass murder. the fact that the bomb wasn't strong enough to take down the plane is not relevant. it is factual responsibility. >> tom i agree with you there. gregg: guys, i want to hit one more subject. and chad, i will put it to you. they didn't need the unmirandized confessions. in other words he statements he made to two different law enforcement agencies before he read his miranda rights. yes, i realize it is coming in under an exception but aren't prosecutors creating an automatic issue for appeal? they didn't need those confessions. >> well, i actually, you're going to be surprised by

this because i'm a defense attorney but i actually believe this is the one limited spot where this public safety exception should come in and that these statements should come in, even though he was not mirandized. the reason being is, he had, he was on a plane. he had a bomb, even if it was just a firecracker, it was a bomb, and who knows if there were other planes, that you know, in some sort of big effort, they were going to try to blow people up. so the fact remains that in this limited situation the safety of our people actually trump individual rights and yet they don't need it but --. gregg: you dent need to -- >> this is textbook example of the exception --. gregg: is this a mistake to try this in civilian court? arguably they knew immediately what was happening and under the law they're supposed to read miranda rights. >> gregg, goes back to my first point. it is precedent that they're setting. i think they will get the

conviction with or without the mirandized statements and even if they get appeal, the words, harmless error. what are we sending out to detractors around the world who want to kill us by telling them, look if you hatch one of these schemes to blow up our people we'll give you the same miranda rights that u.s. citizen will get? >> we're setting a precedent that we're america. if you ask for a trial you get a trial. he will go down regardless. he is america. he pled not guilty. he deserves a trial. gregg: gentlemen, thanks very much. >> thanks, gregg. jenna: a debate we'll continue to have. meantime we'll head back down to d.c. you will see this picture a little bit. we're trying to get the picture up. what you are seeing on your screen some protesters. they're having conversations there. we heard there have been some arrests. this all started at the hart senate office building on capitol hill. it is a protest of fewer than 100 people. they have been chanting numerous slogans, power to the people, end the war. obviously there has been a group of people, as well on

freedom plaza down in d.c. camped out there as part of the wall street protests. again, a live look. you can see it looks like the man in the middle of your screen, we're trying to get a good shot. he is getting arrested. we'll keep you updated as we hear more about this. this is just happening, in the senate. the senate taking up a big jobs bill today as well as a few other items we'll talk about later on in the show. gregg: it is decision time drawing near and one of most horrifying trials that we have ever covered in moments. we'll have a live report on closing arguments in the petit triple murder case. plus, exclusive new details on the federal program that put weapons in the hands of mexican drug cartels. what the investigation means for top people in the department of justice including the attorney general.

gregg: right now american companies have billions of dollars in cash just sitting in accounts overseas, maybe more. many of them refusing to

bring the money home because of the taxes they would have to pay but some economists say, getting companis -- giving companies a tax break on that money could lead to investment and job creation here. joining me the former director of the congressional budget office, douglas holtz-eakin. thanks very much for being with us. you like this idea. i read your op-ed recently which you endorsed it. how much money are we talking about overseas? and are you talking about reducing the tax or zero it out? >> there is probably a trillion, to trillion 1/2 dollars, american dollars trapped overseas what is out of date tax system. in an ideal world, we would eliminate that tax permanently. realistically there is both democrat and republican support for a plan that would temporary lower the tax rate on bringing those american dollars back to help the economy. so, in these circumstances, where the president can't even get democrats on board with his jobs plan to find an idea that brings up the

$800 billion back, creates a couple million jobs and has bipartisan support strikes me as the right thing to do. gregg: doug, wasn't this tried before? i think it was 2004, and some say it really didn't work so well? >> i think those analyses make two big mistakes. the first one is they confuse things that were going to happen anyway. mergers that lead to some consolidation layoffs with the tax policy has nothing to do with it. the second and bigger mistake they look at only the companies who brought the money back and if those companies didn't spend it to hire someone or spend to it buy a new machine they say, oh, it doesn't work. if they repurchased shares or paid dividend to shareholders. the money doesn't go into a black hole. it goes into the u.s. economy where someone else gets the money and spends it on something else. you have to look comprehensively on the impact and if you do that 25% firms increased their employment. 25% increased their investment.

we need both of those things very badly right now. gregg: it is true some of our international competitors have zero or highly-reduced rates. are we uncompetitive as a consequence and that sort of double downs the pain that these companies feel and our economy? >> absolutely. our best companies are uncompetitive on the global stage because we are the last major country to tax repatriated earnings. so it does two things. it means when we compete in a brazil with a german company, the german company has an advantage. the second thing it means that companies don't want to have their headquarters in the united states anymore. we're steadily losing the important jobs coming with a headquarters of a major global corporation. this is something that really has to get changed. gregg: you're convinced the money will come back here and it will create jobs and spur economic growth? you're convinced? >> i am convinced it he is better off in america than trapped offshore and i'm convinced we get some growth. gregg: how much? >> i think we have $360

billion of additional gdp i think almost a couple million jobs next two or three years. it is a big impact. >> on percentage basis would increase how much? >> 2% growth. gregg: really? 2% growth if we brought it back? all right. douglas holtz-eakin, thanks so much for being with us. >> my pleasure. gregg: good to see you. jenna: a 12-year-old's heart stops at school. no warning her heart just stops. meet the coaches who saved her life. plus a lesson we can all learn from her story, next.

jenna: "happening now", a bit of a celebration in texas today for a very, very lucky girl. 12-year-old kylee shea's heart stopped at school, suddenly with no warning. fortunately there was a

defibrillator nearby, easy enough for me to say, right? two coaches used it to restart her heart and save her life. the family wants to get the message out saying all schools should have them. this is i guess why. kris gutierrez is back atmos middle school in texas and this is good story, chris. >> reporter: it really is, jenna. put it into perspective that kylee shea was not in the middle of gym class. she was walking along the hallway heading to gym. this is the hallway you see over here. this security camera caught everything. as we look at surveillance video you want to bring you back out. i want to introduce you to two hero coaches. this is coach brent reese and coach kristin gudjon. you were first on the scene. you saw kylee lying there. what went through your mind. >> she was having convulsions and within a couple seconds she stop the breathing. >> reporter: you toiled

coach reese to get the someone and you went to get the automatic defibrillator. coach reese you showed up. what was she doing? >> she was non-responsive. she would twitch and gasp. that is things you do in assessment you hope everything is okay. you realize it is not regular movement, it is not regular breathing. so we started cpr. >>. >> reporter: to be honest she is fading fast. her lips are pale and turning blue. you started cpr but that alone was not working right? >> that's correct. that was not work. we hooked the ad up to here her. it said advise for shock. coach reese says this is really what we have to do right now. yes, i pushed the about button and shocked her once. we continued compression shuns and advised for a second shock. >> reporter: coach reese, across the state of texas these aeds are mandatory in every school across the state of texas and but not every state has that law. what would you say to others

wondering if my child's school has one? >> this is a great question. most of us are parents. she has a little daughter. i have got three boys. this is something you ask the school, hey, do you have an aed on site? if they do, that's great. do you know who is trained to use them in case of an emergency? that is story that goes around nationwide, just not in texas. we feel it is important for the nation. >> reporter: take it from kylee's parents, folks. it is important to know if your school has one, who is trained to use it, where is it located. in this case it was feet away from where kylee passed out. back to you. jenna: unbelievable story. please thank the two coaches for us as well. real-life heroes. >> reporter: absolutely. jenna: we appreciate hearing that story very much. kris gutierrez in texas today. gregg: we throw around the hero moniker. boy, these are real heroes. good for them. got to love the coaches. breaking news in the trial of michael jackson's doctor. what really happened in the moments before the king of pop's death. the rest of dr. conrad murray's interview with police and the latest from

the courtroom just ahead. plus, modern-day treshher hunters -- treasure hunters, found a 20 ton treshremember trove out in the ocean. how they plan strawberry banana! [ male announcer ] for a smoothie with real fruit plus veggie nutrition new v8 v-fusion smoothie. could've had a v8.

>> rick: i'm rick folbaum at the fox news assignment desk 679 here's where the news dmos and we bring it to you. lawa ingle is outside the courthouse in new haven, connecticut, the terrible home invasion story, closing arguments in the second trial of the second defendant in that case. we'll hear from laura in a bit. that's dr. conrad murray, you recognize him, he is charged about involuntary manslaughter in the death of his former client, michael jackson, the jury is hearing today about an interview that dr. murray gave to the police. we'll have more on that coming up. then doug mckelway is standing by in pittsburgh, pennsylvania where the president is getting set to give a big jobs speech later on today, those are some of the stories we're following for you, but there's a lot more we're doing, too.

the second hour of "happening now" starts right now. jenna: a lot of great stories to get to today, everybody. the candidates are hoping to shake things up tonight, though. there's another presidential debate that's getting a lot of attention and we're glad you're with us, i'm jenna lee. gregg: i'm gregg jarrett in for jon scott him can expect plenty of drama tonight. jenna: drama at a debate? maybe! voters are looking to see how the candidates handle themselves on stage, who rolls with the punches, who folds under pressure and some of the debates have been telling so far. chief political correspondent carl cameron is live where the debates take place. >> reporter: head to go new hampshire, the leaves are beginning to turn in the granite state, it's beautiful, time for a debate. not all the the candidates want to shake things up. there's one candidate who's like to keep things where they are, the front run e.

governor mitt romney, who has a commanding lead in new hampshire, is leading in iowa and leading nationally. the merit poll has numbers that demonstrate this profoundly. in the granite state, new hampshire, mitt romney is at 44 percent, that is a whopping 31-point lead over his nearest competitor, the georgia businessman, herman cain at 13 percent, and cain is tied with texas congressman ron paul in new hampshire at 13. that is a huge gap, the nearest competitors after that, you got to go down into single digit, rick perry and jon hauntsman --sman, way, way back. then there's iowa, the leeoff caucus state where romney has not been campaigning aggressively and has signaled perhaps he will not significance anify all that much. it's at 23 percent, but a tight race with cain at 20 percent, ron powell paul, 11 percent, michele bachmann at 10 percent, tied with rick perry at 10 percent. texas governor rick piry has

a tremendous amount riding on tonight's event. his sliding polls comes after two admittedly weak debate performances in which he stammered on answers, blew attacks on mitt romney and said things that upset conservatives, offended them when he said they have no heart if they disagree on in state tuition for illegal immigrants in texas and didn't acquit himself in his own wife's view as well as he he said so perry has been hitting the books, getting prepared. there are also significant questions about what this means for jon huntsman who considers new hampshire a must-win state and michelle bach hawn who has disappeared from the polls since she won the ames straw poll two months ago after having pretty strong debate performances herself. it will be a two-hour debate tonight, almost entirely about the economy and jobs, though one could expect there will be some questions about mormonism which has come up on the campaign trail of late as well as questions from black

liberals who have been very critical of herman cain's conservatism, they don't fall into the rubrick of economic jobs discussion, but in a debate that lasts two hours in new hampshire with the first vote for president three months away, anything can happen tonight. jenna: a great rundown, and i think you coined a brand new phrase for us, debate weather, the leaves are changing, it's a beautiful blue sky. gregg: isn't it pretty there? jenna: debate weather! great to have you with us, carl. gregg: let's take a look at the bigger picture, "the washington post" bloomberg poll those that mitt romney is ahead on a national level with 24 percent among republicans and republican-leaning voters, but he's followed closely by herman cain who has vaulted to second place, rick perry, ron paul and michele bachmann. bret baier joins us live from washington, anchor of "special report". it's not only that cain has bolted to second place now. take a look at this gallup poll on the screen, this one just out and essentially, romney and cain are nearly

tied, i guess you could call it a statistical tie because they're within the margin of error, romney at 20, cain, 18, rick perry -- he was at 31 percent, not long ago, now at 15. what do you make of the rise of herman cain? >> gregg, first of all, let me just comment that carl looks happier than when in new hampshire in the middle of politics. he just looks happier there! anyway, cain's rise is really -- has really been something to watch. it's been steady, it's been constant, it's been tied directly to his debate performances. he had a number of them that he did very well at, the last one we held in orlando arguably some people said he won. he got a lot of attention. and, as perry has stumbled, cain has picked up some of that momentum, and you look at the trend lines, and exactly opposite, as governor perry has gone down, cain has surged up, and largely because it seems

the gop primary voters want an alternative to mitt romney. not that he's not going to be the nominee eventually, and he'll -- his plan is to fight and be the last man standing, and get all the delegates needed to get the nomination. but it appears that each state wants an an alternative to mitt romney. gregg sure. speaking of debates, bret, tonight's debate is a little bit different in three ways. first of all, one subject, really, the economy, second of all, they're going to be seated, not standing, and take a look here, here's the graphic we created at the positions. romney and perry will not be placed next to each other as they have in past debates, romney and herman cain, they're going to be front and center, they're placed in order of poll positions, apparently like nascar. look, might that altar the dynamic and substance of the debate? or is it largely insignificant? >> well, you know, it's based on their polling, and where they stand.

i think this debate sets up well for herman cain, because it's supposed to be just about the economy, as carl mentioned, other topics will likely come up, but that's kind of his wheel house on the stump and what he's been talking about. i think governor perry needs to have, according to most analysts, a big night tonight, a good night tonight, after the debate performances in the past, and there are others at that table who expect to try to shake things up after obviously perry, romney and cain are getting all the attention in that top tier. ron paul is, we should note, right there, in all of these poll polls, with cain or in some cases, above him. gregg: right. and he's won some straw polls. also, there's a report today by nbc news, we're trying to confirm this ourselves, we're looking at white house logs and so forth, but that romney advisers actually, you know, went to the white house and helped advise president obama's health

care law. is that an issue that continues to really dog mitt romney? >> it is. and it has been. and it's really some of the vulnerability within the gop primary voters, and you ask in a poll what concerns them, and that does come up. and the fact that governor perry is hammering away at governor romney in a new ad and what i think is a big buy on this ad about romneycare, the fact that this story today is coming out after this big buy yesterday and over the weekend, it is a vulnerability, and how governor romney handles that, he's handled it well in debates in the past. we'll see how he does tonight. the sole issue is whether he supports the mandate as he did. he's explained it, that for a state, it's okay, for the nation, it's not. this story does not help him. gregg: bret baier, thank you very much, bret, good to see you.

bret will give you more details before tonight's big debate, tune in, "special report", 6:00 p.m. eastern time. jenna: tough turn to a tough story next. in a connecticut courtroom, closing arguments are underway in this capital murder trial of the second suspect in a horrific home invasion, the killing of jennifer hawk pettitte and two daughters, hay lee and mckayley, you're seeing the picture on the screen, the house set on fire and joshua komisarjesky facing the death penalty if convicted. laura ingle has followed this story from the beginning, she's outside the courthouse in new haven with the latest. >> reporter: jenna lee, the day got off to a surprising start when defense attorneys requested a continuance in this case, just before closing arguments were set to begin, sthaig they had brand new letters from stephen hayes, the first defendant in this case, who was convicted and sentenced to death last year for his role in the home invasion. now, in these new letters, stephen hayes claims to have

killed 17 times before the home invasion, he says each murder preceded by raping these victims, he said in these letters he would have killed komisarjesky if he had tried to get away during the home invasion. the judge rejected the motion for the continuance, said the letters were not relevant and court moved on. now, prosecutors opened their closing argument by telling jurors, everyone is here today because of joshua komisarjesky, and stephen hayes' cold and calculated decision to terrorize the pettitte family, going over evidence learned in the trial, komisarjesky's defense team has repeatedly argued throughout this it was stephen hayes who poured the gasoline and lit the match that turned the pettitte home into an inferno where the two pettitte daughters were tied to the beds. prosecutors highlighted a part of the komisarjesky confession to police when he says on the tape we didn't pour any gasoline in the office then he quick li corrects himself, saying he, referring only to hayes, so

it seems like he caught himself there. prosecutors also brought up komisarjesky's statement that he closed the door to the bedrooms to buy them time before the fire was set, but the state said maybe he did that to stop from hearing the girls' screams. prosecutors will get a chance to do a rebuttal argument after the defense has its closing arguments, which just started moments ago. the defense team has asked if it would be okay to have joshua komisarjesky stand at the defense table for part of today's closing arguments, so that will be a dramatic scene for sure, as he stands and faces the jurors. we've also just been told from our producer in the courtroom the defense has opened up saying komisarjesky certainly participated in some of the crimes in this home invasion that would shake one's faith in humanity but never intended for anyone to die. we'll continue to bring you the very latest from the courthouse here in new haven. jenna: some significant words there, laura, and a story we'll continue to follow to the very end. laura ingle, live in connecticut for us today, thank you.

gregg: she stormed her child's bus to take a stand against bullies before scuffling with cops. now she is on trial. the jail time she could get. plus, new details on a bloody crime spree, what the suspects are saying about a motive. and rick is at the web wall. hey rick. >> reporter: gregg, we were listening to you and bret talk about the debate and that's one of the polls at the happening now news page, foxnews.com, specifically we want to know about your thoughts of rick perry and his performance, what does he need to do. is tonight's debate a make or break moment for the governor. let us know what you think. i'll show you what the results are so far. so far, about six 8 1/2% of you say yep, governor perry better step it up. other -- our other question on the poll, should congress do something about jobs, yes or no. and so far, the results are a resounding no. let capitalism work its magic. a couple of ways for you to participate. not too late to go online.

a little job for you during the commercial break. we'll have more of "happening now" coming up.

gregg right now, new info on crime stories we're keeping a close eye on. the couple suspected in a string of grizzly murders telling their side of the story, dave and julie pederson taking full responsibility for killing his parents and two others, he claims he killed his dad when he molested two relatives. >> opening statements in the trial of the suspected christmas day underwear bomber, umar farek abdulmutallab, with a planeful of witnesses willing to testify against him. >> and qut for the death penalty, jamal had his sentence overturned after a court of appeals found instructions given to the jury back in 1982 were potentially misleading. his conviction has been upheld. jenna: now smu information on this story. a florida mother on trial

for what she says was just an attempt to protect her child from bullies. rick, what do we know about this? >> reporter: this is laura booker, she says she got on her daughter's school bus because the girl was being bullied, the whole thing was captured on videotape and the jury is expected to see that surveillance videotape later today. the bus driver sz he told ms. booker to get off the bus almost a dozen tiles and the police called to the scene said she didn't follow instructions to get off the bus, either, that's when they took her to the ground and cuffed her. says she was never abusive or profeign, she claims the bus driver was actually the one assaulting her child, the state prosecutor said that laura booker knew she was wrong to get on the bus and knew she was wrong when she refused to get off. she was charged with trespassing and resisting arrest. again, her trial today. weep update you. jenna: you can understand a mother getting heated about a bullying situation, but there's also the law. we'll see which way that

goes. thank you very much. gregg: all right. a crucial vote is coming up on capitol hill as the u.s. senate considers the president's plan to create jobs. plus, breaking developments in the disappearance of this little ten month old girl, lisa irwin, why relatives say her mother expects to be arrested. and the surveillance videotape, taken just hours before the baby vanished. judge alex on what cops may be looking for.

jenna: now a fox business alert, we're awaiting a key vote in the senate on the president's plan to create more jobs. live to capitol hill with the latest. hi rick. >> reporter: hey jenna. the president has just urged congress again to pass this jobs bill, he says there will be immediate job

growth, laying the foundation for long term job growth but still it's unlikely the u.s. senate is going to come up with the 60 votes needed to pass this procedural hurdle and get the entire jobs bill through the u.s. senate and through the u.s. congress. now, when you look at what senate democrats have done here, they've kept the tax cuts and the spending the same from what the white house proposed but they've swapped in their own tax system. there would be a tax increase, 5.6% surtax on all income of more than $1 million to pay for this jobs plan, and that boo start in 2013, and we asked the white house earlier this morning and top economic adviser there as to whether or not tax increases in 2013 arranged like this could stunt economic growth and here's his answer. >> it doesn't even affect a penny of spending or taxes in 2011 or 2012, it starts in 2013. hopefully at that point the economy has gained greater momentum and then it's just affecting three out of 1000 taxpayers, and those who as

economists say have the lowest marginal propensity to consume. >> reporter: republicans had argued that you're taking and taxing about half a trillion dollars over ten years from the economy and it will absolutely have a negative effect on jobs growth. from here we expect this vote around 6:00, 6:30 tonight. it is not expected to pass. as for plan b, democrats are already talking about breaking this bill up and trying to pass it in pieces. back to you. jenna: more as we get it, rick, thank you very much. gregg: some new information in the week-long search for missing baby lisa irwin. we're getting reports that her mother, deborah bradley, who has tearfully begged for lisa's safe return now expects to be arrested. this as the search for baby lisa leads to a grocery store surveillance tape and a taped interview with friends and family of the missing ten month old. judge alex ferrer joins us

live. judge, always good to talk to you. the fact that police are so very interested in the mother's whereabouts, you know, going to the grocery store, apparently with an unidentified man, hours before the baby vanishes, buying, i don't know, wine in a box, paper plates and so forth, does all of this suggest to you that they're focusing on the mother here? >> yes. it does suggest that. but that's not unusual. you have to remember, gregg, that in the vast majority of the cases where a child disappears, it's somebody who knows the child and somebody very close to the child. only in about 5 percent of the cases is it some stranger who came in through a window. we've heard about several of those like the smart case and several of case -- several of those but for the most part it's family members, parents, involved in the disappearance, sometimes as a coverup for an accidental death or things like that. in fact, there are about 1500 children who are murdered by their parents every year, most of them are

infants. so it's absolutely natural for police to focus on the parents and if they find inconsistencies in the statements, even more so. gregg even the mother seems very tearful and that's moving and i suppose it's important, until you remember that susan smith was quite tearful and then it turned out that she drowned her three children, and of course, she blamed it all on an abduction initially, turned out it wasn't true. >> yeah, that's absolutely true. people would look at the susan smith case and look at her and say come on, she's not that kind of mother to do that, she loved her children dearly, and if you'll remember, she loved them dearly, but she had no problem strapping them into the car and pushing them into the lake, and i remember seeing her tearfully on television, crying for the return of her children. i got a really bad vibe when i watched her do that. i remember turning to my wife at the time and saying about susan smith, i'm talking about, there's something wrong with this, i think she knows something she's not letting out, and i'm not sure how i feel

about deborah bradley in this case. we'll have to wait and see. but the police feel like they're on to something, obviously. gregg: it's very hard. the police did a conspicuous reenactment in broad daylight of breaking into the house, crawling through a window and bring a child -- they used a doll -- back out. does that -- i mean, part of me seems to think wait a minute, they wouldn't do that unless they doubted the mother's kidnapping and breaking and entering story. >> i think they want to make sure it was possible. i'm not sure that the child came out the window. i think the window was probably -- if it happened that way was the entry point, the front door was also found unlocked so i suspect they would have gone out. but the police are going to investigate every aspect of it and the parents are going to be target number one and i heard at one point she had stopped cooperating with the police and clearly, if she did, that could be a big indication of guilt but it could be that the police are going at her so strong she needed to take a step back

and say you know what, i'm not talking to you anymore, we'll have to wait and see how it plays out. gregg: the oddity is the -- the mother expects -- the expects to be charged, there is no body, maybe baby lisa is still alive, we hope so, but there's not much incriminating evidence at this stage to charge, would there? >> no. i think the police would not charge her. even if they had incriminating evidence, they would try to get more statements to pin her down, if they had the goods on her, basically. the only reason they would go forward and charge her without trying to push for mer is if she lawyered up and at what point -- at that point, she won't get a statement. statistically, when the child a kidnapped by a stranger, most of the time, the child is still alive, most of the time it's because the person wants a child. gregg: we sure hope that baby lisa is still alive. judge alex, thank you. jenna: it's been exactly a week, huh?

exactly where we are. we'll continue to follow that story, along with this one. we have a fox news exclusive coming up, brand new details on the fast & furious investigation, a subpoena ca be -- could be directed at the attorney general. we'll have a live report coming up on that. plus we're live in lossac -- los angeles, at a courtroom where jurors hear one more day of testimony about what happened when michael jackson died, in his doctor's own words. we have that next. >>

jenna: welcome back,

everyone. fox news alert, we have exclusive new details on that the fast & furious investigation today. a spup could be filed for attorney general eric holder as early as today, and fox news has learned it will seek documents and communications from top justice department officials. william la jeunesse has been trailing this story all along, he's live with us from los angeles today. william. >> reporter: jenna, when you cover government, you realize there is a paper trail to every decision, and now with e-mail you see substance and intent because it's so personal. in the last eight months senator grassley and congressman issa only issued one subpoena, back in march, focused solely on the atf, the new subpoena, much broader, it asks for specific documents related to the murder of border agent brian terry. to resolve conflicting accounts on the type and number of guns found at the crime scene and where they came from. there's evidence that an fbi informant bought those guns in a deal set up by a dea informant. the subpoena also seeks to

clarify a possible white house connection. the justice department has claimed this was a law enforcement operation, period. others suspect a political motive, that some of the -- some of the white house wanted u.s. guns to cross the border to justify a ban on limit on the sale of assault weapons. the subpoena also demands any and all communications from a dozen top assistant and deputy attorney generals. those e-mails could answer definitively exactly what did the attorney general know, and when did he know it. >> now, because every day, a new stone is turned over, and new evidence, more leads to follow, and we have to get to the bottom of this. >> reporter: that includes how ring leader manuel selisicasta bought some 800 weapons with half a million dollars on his salary of $15,000 or jorel fatino bought 1300 guns while on food stamps. documents show top doj

officials knew of these facts in march 2010 but did nothing to stop this pair from buying hundreds of more weapons on behalf of the cartels. finally the subpoena will request all communication from the doj to the atf and state department officials in mexico. remember, this operation was supposed to take down this operation, top to bottom, from phoenix to mexico, and yet, we never told our agents in mexico what was happening, who and where to conduct surveillance and finally, that subpoena would come out as early as today or this week, jenna. jenna: we will wait and watch for that, william, and continue to follow this story. thank you. >> i'm not sure -- [inaudible] >> then they were weeping, really weeping.

i hug them all, give comfort to paris, comfort to prince, comfort to blanket, jenna: gregg: an emotional moment at the manslaughter trial of michael jackson's doctor conrad murray. jurors hearing more of murray's taped interview withplicity as the doctor calls how jackson's three children cried upon learning of their father's death. claudia cowen, live from california, superior court in los angeles. claudia. >> reporter: >> i can tell you there were tears in the courtroom as michael jackson's mother had to relive that painful morning two years ago when she learned that her son had died, the events described in this audiotape dollars police interview by dr. conrad murray as he gives his version of events without exposing himself to

cross-examination. dr. conrad murray had already explained how, against his better judgment, he gave into jackson's desperate plea for the milk that always helped him get to sleep, that was the nickname for the powerful anesthetic propofol. murray says when jackson did finally fall asleep he left the room for two minutes and when he returned, jackson had stopped breathing and could not be revived. today jurors heard murray tell police how he consoled katherine jackson at the hospital, describing how she broke down, weeping with grief, and having it all come back tier in the courtroom to speed away from her son's killer, jackson's mother could not hold back the tears. also on the audiotape, murray is describing a heartbreaking encounter with jackson's children who were sobbing at the hospital, in particular with his then 11-year-old daughter, paris. >> i knew dr. murray, i knew you tried your best. i knew you tried your best.

>> murray goes on to explain how he helped arrange for michael jackson's body to be prepared for viewing so that his children and other relatives could properly say goodbye to him and finally, gregg, murray says that at one point, he had a conversation with katharine jackson there at the hospital, she asked him point blank, how did my son die, why did this happen, when he was in your care, and murray's response was simply, i don't know. gregg, that audio taped evidence has just wrapped up, and witnesses are now back on the witness stand undergoing more questioning. we'll have more updates later on today. back to you. gregg: claudia cowen, live in los angeles, thanks. jenna: gregg, we're going to turn back to the economy now. there's a disturbing new report out of china today that could have major implications on our shores as well. china is pumping money into its banks and some analysts say it's really pointing to some weakness in the chinese

banking system and more broadly, the chinese economy. others say really, this is just business as usual. so the question we're asking today is what's going on here and what does this mean for the global economy overall. guarden chaing is author of the coming collapse of china and columnist at the daily and this is the broad theme we have to explore. what does this actually mean for us in america? >> you know, china is big and greece is small and everyone expects greece to default, but china is actually in worse shape than greece. you know, greece hasn't defaulted yet but last year in china, de fact --o de facto government agencies stopped making interest payments and this is actually very serious. everyone is expecting greece to go but no one is expecting china, so when china's problems become more evident, i think the globe at panic will take markets down worldwide. jenna: you say there is a real problem here in the chinese banking system. >> oh, definitely. because of the end of 208, beijing forced its banks to make about a trillion dollars in loans to unviable projects, go cities, all the rest of it, now the chinese

economy is starting to get smaller, so right now, beijing is in panic because it knows its banks are the bull worth of the economy and if the banks go, the economy goes. jenna: let's take a step back because a lot of us don't know a whole lot about the banking system in china. what was the role of the government in the banking system, in business as usual? was there already an established role? >> the state banks are the ones that are really propping up the economy. and everybody that five years ago said they're reformed and acting like western banks, well, they weren't, because beijing used them to pump all of this money into the economy for loans that no other banker in the world would make. they did that to keep the chinese economy going. now analysts know a lot of the borrowers can't pay the money back, which really means then essentially you've got these insolvent newses that are supposed to prop up the chinese economy and now they're in trouble. jenna: can the government continue to prop them up and avert disaster? >> probably not, because essentially what happens is they put more money into the

economy, it's going to create more inflation, inflation right now is the worst problem in china. you got to remember that inflation preceded the tiananmen demonstrations in 1989 and the got, the last thing it wants it more inflation. jenna: let me ask you about a different side story as we take a look at this as well. in the senate today, we expect legislators to bring up this bill about essentially punishing china for currency manipulation. >> right. jenna: the reason why chinese goods are so cheap is because they keep currency low and make it easier for all of us to buy. what do you think of that move, considering this news today? is this a good move for us, a bad move, does it matter? >> we need to do this, because people worry about us doing something on currency and starting a trade war. jenna: right. >> you can't start a trade war, because the chinese are waging one against us and the question is how are we going to respond. china needs us a lot, 149 percent of china's trade surplus related to the u.s. if they start a trade war,

they're in trouble. we're the decifit country. in trade wars decifit countries do well and surplus countries like china do poorly. we don't have to worry about china. jenna: i guess we'll leave it there. there are going to be more questions. we hope to have you back. this is a story we continue to watch. thank you, nice to have you with us. gregg. gregg: devastating flood, killing hundreds of people and this disaster could get even worse, as waters threaten to engulf one of the country's capitol city. u.s. prosecutors call him the biggest arms in the world -- arms dealer in the world. the trying of victor budo, also known as the merchant of death.

megyn: hey everyone, i'm megyn khel yevment there is breaking news in the disappearance of lisa irwin, the ten month old baby missing in missouri. what police reportedly found inside that baby's home that casts new doubt on the mother's story. and what it may have to do with another man. plus, these occupy wall

street protestors now heading to the personal home of five random millionaires today. right after the seiu gets involved. >> the hermanator, the perry camp is live on how its candidate can survive. >> all that plus the second half of the tape with michael jackson's doctor, talking about the moments before the pop star died. you'll see it all minutes away. gregg: right now new info on stories we're watching from across the u.s. and around the world, all from inside our control room, thailand, racing to build flood walls on the outskirts of bangkok to prevent the worst flood in half a century from swallowing the capitol. >> steve jobs, died of respiratory arrest resulting from pancreatic cancer that had spread to other jorgans, he died at the age of 56.

>> elizabeth taylor's diamonds, the jewels, with 2000 pieces of memorabilia of the late hollywood legend, about to hit the auction block. jenna: hope you're ready! gregg: even a little bawbel, i couldn't afford! jenna: looks like a good gift. a russian known as the merchant of death on trial for selling weapons to terrorists, prosecutors same victor boot took part in the killing of americans. eric shawn is watching this -- watching this from federal court in new york. >> reporter: you wouldn't know that victor boot has the reputation of being one of the world's largest arms dealers. he is in a courtroom behind me, dress a pinstripe suit, looking like any businessman. that's what his lawyers say he is but that's not what the federal government has charged, they say he's a notorious arms dealer who has fueled conflicts around the world.

victor buda is charged with being an arms dealer who has helped arm armies in war-torn countries from africa to the middle east, he is charged with conspiracy to kill americans , in it 2008, during a dea sting in thailand. here is the information he offered to sell to the dea agents, 700 surface to air missile, 5000, ak47 missiles, land mines, c4 plastic explosives, and millions of rounds of am nicks. experts say he made a fortune arming the world. >> we're talking about massive loss of human life. we're talking in the millions. these are the kind of wars that victor bute has not only supplied, but he's actually facilitated and initiated war. he's changed the face of war. and in many different countries. >> reporter: the report say bute is worth an

estimated $6 billion this trial is expected to people back the shadowo peel back the shadowy world of arms trading, like a spy or suspense novel. his lawyers say he didn't do it, they say he's a legitimate arms dealer, never traded in arms but ran a cargo airplane. -- airline. victor bute is a dynamic, charismatic, spontaneous, well dressed, well spoken and highly energetic person. victor may have violated laws somewhere like we all have done sometime, however he was not that arms trafficking man presented to the public by the propaganda jockeys through the media. if victor bout is convicted of the charges of which he is accused of here in federal court he could face life in prison. the jury selection just beginning this afternoon. it could take a couple of days before the actual testimony begins. back to you at the studio. jenna: quite a description on that website, eric. we'll see what prevails as

we move forward. gregg: propaganda jockeys. never heard that one before. he's calling himself a superhero, out to protect the good people of seattle, but his latest exploit, have him sitting in the big house. why the woman he claimed he was helping was yelling get away from me! chasing him with her shoe. call it a stimulus plan at the bottom of the sea, while the british hope a sunken ship will give their economy a boost.

gregg this guy goes around trying to fight crime in a

costume but somebody was trying to assist and ended up helping him get in the clink, rick folbaum has more on the story. >> reporter: for folks who live in seattle they may have seen this guy around town, he's a self-styled superhero who calls himself phoenix jones but someone turned the tables on the 23-year-old marshal artist after he allegedly assaulted a group of people outside a nightclub with pepper spray, jones and his sidekick ghost said they were trying to fight up -- break all fight. police say there was no evidence of a fight. you can see the woman chasing him, yelling for him to get away. jones, complete with his camera crew that follows him around, he has a facebook page where he posts videos and touts his work. he says i symbolize that the average person doesn't have to walk around and see bad things and do nothing. he was booked in county jail on four counts of assault with arraignment set for thursday and we agreed not to release the true identity of phoenix jones in exchange

for being able to show you this video. jones' wife, purple rain, has not commented, and a police officer in seattle has summed it up by saying just because he's dressed up in costume doesn't mean he's special. but gregg, try telling that to bruce wayne. gregg: yeah, purple rain is his wife? i'm kind of thinking maybe a court ordered psychiatric examination may be needed here. rick: i don't know, don't knock it, gregg, this guy is going around, trying to help people. gregg: where's robin when you need him? thank you, rick folbaum. jenna: all right, call it the stimulus plan under the sea, the british government paying a florida company to locate a steamship that sank in the atlantic, the reason, there's 20 tons of silver that went with it. at today's value, it's $18 million this comes on top of an even bigger discovery just a few weeks ago. we talked to the president and coo of odyssey marine exploration then, his name

is mark gordon and we're talking to him now. mark, second discovery in a matter of a few weeks. how did you find this one? >> the same team, tools and technology for the garisop, the larger recovery, or find that you mentioned earlier. we were out after we were done successfully locating the garisoppa, on the way back in, about 100 miles away, our research marine ops team had been working on this target and we dove on it and sure enough we have located the mantola with 20 tons of silver on board. >> you're in a bit of a roll now! what's next? >> i can't tell you that! but i can tell you this, obviously, other governments are starting to look at this, and seeing the viability of our business model, which has been to go out, take the risk as the entrepreneurs, and then share the returns, and in the case of the british government, it's an 80-20 split so it's good for our shareholders but it's also good for the british

government and their taxpayers. jenna: you have the two ships that you discovered, literally treasures under water. do you have anyone guarding them at this time, now that you found them? >> that's great question. the remote location and depth of these sites, this one is in about 8000 feet of water, about 200 miles off ireland in the north atlantic and the fact that there aren't too many people in the world that have the capability to work at this depth, that pretty much protects the sites. we do have ways by satellite to monitor the sites and we do have legal protections, because our arrangement with the british government is a salvage contract that awards us some rights. jenna: i have ten seconds. gregg wants to know if you're hiring! >> absolutely. we're always looking for good people! jenna: that's a good answer, especially in this economy. mark, we look forward to talking to you again, third discovery in a row. we're going to be waiting and watching for that. thanks for taking the time. we'll continue to follow your story and be right back with more of "happening now". >> great being with you.

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